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**Relsenlilky** · 05-07-2012, 06:19 PM

Yes, that is what our current system is. Money is no longer backed by gold, so its no longer a promisory note, or receipt note etc. So there is no point digging old argumentation of last centuries about the trade of debts. It does not apply to our currency anymore.

Yes, money is merely printed. Tomorrow US can print 2 billion more notes, and it will have 2 billion more dollars in circulation. But the money market will devalue the dollar because of the excess of dollars in the market. Suply increases, the demand decreases. Although its not as simple. The strength of dollar is not only because of it being printed or being in abundance etc, its primarily because of the high dependence on it in the global market. The demand you will have for dollar in international market, the more leverage you will give america to carry on printing it. This is why America was against the concept of Euro. because euro provide a more stable currency for the world market to rely on.

Hence, the idea of bringing gold and silver back is definitly a noble one. It will crush this fiat money. The only contention has been the way to go about it.

If money is no longer a promissory note than why it's written "Payable to bearer on demand" on Pak rupees note, there's got to be an explanation for this?

Though the printing of paper money- dollar is being considered, why no consideration is given to the major source of money supply (almost 80%) in the form of magical Fractional reserve system. This mechanism can be equated with the Jews who used to issue more (paper receipts) compared to the Gold they had in possession. It's obvious that with this Money Supply- M2, it's not possible for the paper money to retain it's real worth.

And if the paper money can't hold on to it's worth, there are few consequences:

a) it ceases to perform the function of store of value-- what good a money is which can't even perform one of it's own function.

b) the proponents of interest based banking takes the plea that interest is just a form to compensate the lender for the loss in the real worth of the money.

c) Pressure is developed on the Islamic Scholarship to devise ways to compensate the debtors for the loss in purchasing power in paper currency. This was hinted by Mufti Taqi Usmani Sahab in his Riba' judgement Point# 186-187

05-07-2012, 06:19 PM	#40
Relsenlilky Join Date Oct 2005 Posts 465 Senior Member	Yes, that is what our current system is. Money is no longer backed by gold, so its no longer a promisory note, or receipt note etc. So there is no point digging old argumentation of last centuries about the trade of debts. It does not apply to our currency anymore. Yes, money is merely printed. Tomorrow US can print 2 billion more notes, and it will have 2 billion more dollars in circulation. But the money market will devalue the dollar because of the excess of dollars in the market. Suply increases, the demand decreases. Although its not as simple. The strength of dollar is not only because of it being printed or being in abundance etc, its primarily because of the high dependence on it in the global market. The demand you will have for dollar in international market, the more leverage you will give america to carry on printing it. This is why America was against the concept of Euro. because euro provide a more stable currency for the world market to rely on. Hence, the idea of bringing gold and silver back is definitly a noble one. It will crush this fiat money. The only contention has been the way to go about it. If money is no longer a promissory note than why it's written "Payable to bearer on demand" on Pak rupees note, there's got to be an explanation for this? Though the printing of paper money- dollar is being considered, why no consideration is given to the major source of money supply (almost 80%) in the form of magical Fractional reserve system. This mechanism can be equated with the Jews who used to issue more (paper receipts) compared to the Gold they had in possession. It's obvious that with this Money Supply- M2, it's not possible for the paper money to retain it's real worth. And if the paper money can't hold on to it's worth, there are few consequences: a) it ceases to perform the function of store of value-- what good a money is which can't even perform one of it's own function. b) the proponents of interest based banking takes the plea that interest is just a form to compensate the lender for the loss in the real worth of the money. c) Pressure is developed on the *Islamic Scholarship* to devise ways to compensate the debtors for the loss in purchasing power in paper currency. This was hinted by Mufti Taqi Usmani Sahab in his Riba' judgement Point# 186-187
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